[valuearb]

The concept of double taxation is incredibly important. When you pay income and payroll taxes on your wages, its important to understand what your real tax rate is, and its a lot higher than either individually.

So what's the real tax rate in investments in the U.S? Well it's the corporate tax rate. Plus the investors capital gains or dividend tax rate. Plus the state corporate income tax rate. And the investors state income tax rate.

All these layers of taxation means it's almost impossible for taxes on profits to be less than 40% for an investor, and can reach 60%.

And sales tax isn't part of the double taxation layer, because it's voluntary. You could have spent your net earnings on things that don't have a sales tax, or saved it. And sales tax applies equally to the investor receiving a dividend.